While World and North American operate charters for a variety of customers, the US military’s withdrawal of troops from Iraq and drawdown of personnel in Afghanistan have likely put a heavy damper on Global’s revenues. World and North American’s largest single customer is the US Air Force Air Mobility Command, which transports troops and cargo to and from military bases around the world. Combined, World and North American are the largest providers of military transport services. The company has also been hurt by rising fuel costs and increased competition in the cargo market.

In the bankruptcy filing, Peachtree, Georgia-based Global listed $589.8 million in assets and $493.2 million in debt as of Dec. 31, according to a Bloomberg report.

Global said in a statement that operations would continue uninterrupted and employees would continue to be paid. Vendors with invoices issued prior to the filing will have to wait out the bankruptcy process, but future invoices will be paid as normal.

North American operates three Boeing 757 and five Boeing 767 aircraft, all in passenger configuration. World flies eight McDonnell Douglas MD-11 freighters, seven MD-11s in passenger configuration and four Boeing 747-400 freighters. All planes at both airlines are leased from a variety of sources.

Global Chairman and CEO Robert Binns said that while the company had made efforts to reduce expenses for the past year, “the Company needs to complete its comprehensive restructuring due to having too large a fleet, labor costs that exceed industry standards given the current global economic environment, and the necessity to align the capital structure with the size of the Company.”

“Throughout this restructuring process, our customers, including the United States Department of Defense, can continue to depend on us to provide the same safe, high quality service they know and have come to expect from us,” said continued Binns.

Global is represented by Kirkland & Ellis LLP and its financial advisor is Rothschild.

UPDATE 2/6 3:00 PM: In a bankruptcy court hearing Monday morning, Global said it seeks to shed more than half of its current fleet to save about $40 million a year. The company also wants to consolidate New York-based North American Airlines to its Peachtree, Georgia headquarters.

Anonymous

The adjustable rate mortgage that I had before had me nearly to the brink of bankruptcy because of the never-ending payment increases. Now I have 3.18% fixed rate. I would absolutely recommend 123 Refinance I worked with to anyone I know planning to refinance mortgage.

http://profile.yahoo.com/4YJSILZF6RVMIJQFZCGEDSWRL4 AD

Makes no sense…..World and NAA do not pay for fuel when they are operating these DOD flights, also they get a ‘rebate’ on fuel when they ferry aircraft to mission start points, how can they possibly be losing this much money? Office pizza parties?

Cameron Tu

Owning and maintaing the aircraft (I assume they do own/maintain them) is expensive for an airline that relies primarily on military charters.

http://profile.yahoo.com/TAIGB2VSNVTYUNUOBVTZD7WKYI Honor

The lease all their aircraft.

http://twitter.com/WheresThePlow WheresThePlow

Labor is expensive. Maintenance is expensive in the charter world when you operate at airports that are not a base for you and you need to contract out. Loss of revenue with dwindling war. Patterson not giving a hoot.

http://profile.yahoo.com/TAIGB2VSNVTYUNUOBVTZD7WKYI Honor

That may be the case…..but they were giving out their execs multi million dollar payouts that amounted to about $20 million. I I don’t know how they have the gaul to say that the labor force is the problem when they are receiving those kinds of bonuses.

http://profile.yahoo.com/TAIGB2VSNVTYUNUOBVTZD7WKYI Honor

World Airways does not operate 7 passenger a/c anymore. They lost two back to the lessor and only two are flying as of this moment I believe. I know this because until Dec 31st of 2011 I was a flight attendant for them. Since then, 310 of the 485 flight attendants have been let go……..plus a number of pilots and mechanics.
Look at Matlin Pattersons’ track record with airlines and I think you can see that it was destined to go here from the moment they got hold of us.
Then add the large executive bonuses on top of that……I would say that vulture corporate practices and huge golden parachutes are what’s unsustainable here……….sickening.

Anonymous

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Anonymous

I’m not really sure who did the research on this article , but NAA is currently operating 5 767′s , all of the 757′s are now gone . We will be lucky if we can keep the 5 we have left . Our management team has taken bonus checks every year since I have been with the company. Corporate greed stinks, they stuff their own pockets not caring about what happens to others. Very sad.

http://nycaviation.com nycaviation

The article was written just a few hours after the initial filing, before the airline publicly disclosed that the 757s would be shelved.

Thanks for reading!

Anonymous

GLAH has been “diddling the books” for awhile! They can’t keep a lawyer because the lawyer doesn’t want to go to jail. Speculating …. of course.

http://profile.yahoo.com/WI3KZ7UAOJNL5QWEWD3O4BLWAQ m

The reincarnation of Frank Lorenzo ONCE MORE!

Anonymous

I worked as a pilot for North American for over a year and saw how disorganized the company operated. Half the time hotel rooms weren’t even booked for the crew members and we were stuck waiting at the airport for an extra hour or two after flying around the globe all day. I cannot understand what Robert Binns means by ” labor costs that exceed industry standards given the current global economic environment.” Either you’re meeting them or you’re not. When I was there our pilots were currently the lowest paid 757/767 pilots in the country. Given the amount of experience required to even get hired to fly for them I take it as an insult that he wants to further rape the already underpaid pilot and flight attendant group who is let’s face it the backbone of the entire airline.

While at NAA I saw a huge lack of leadership. The VPs would come into to our class and basically admit they have no ambition to grow the airline. That they “will do whatever the military tells us to do.” While I was there in 2007-08 the airline terminated all of their scheduled tourist flying to Lagos, Accra and Georgetown Guyana because they couldn’t compete with Delta out of JFK. I saw the writing on the wall and finally quit. Luckily, I now work for a larger ACMI airline that is constantly looking for new ways to bring in business and will do whatever it takes to make the airline profitable. We enjoy good pay and work rules, nice hotels and we just added the 767 to our fleet. It’s nice to work for a management team that gives a damn and has vision for their airline.

http://twitter.com/WheresThePlow WheresThePlow

This bankruptcy was hardly the result of anything that went on at North American, regardless of any faults that people feel they may have. NAA remained profitable consistently, but the pressure of ATA debt and challenge outside of the company are what brought this to NAA’s doorstep.

The “not wanting to grow” stuff was dead-on, playing it safe and not biting off more than could be chewed. Omni tried to grow and they suffered the same amount of turmoil just recently.

Ending scheduled flying was actually smart. I’ve never heard anyone cast blame on NAA for doing this. Yes, it’s difficult to compete against a major carrier like Delta, and fuel costs were astronomical. Sole-charter was a very smart move.

The hotel bookings issue is something that may have happened occasionally, but isn’t an indication of the company as a whole.

Well said. World was the same. Just horribly managed. Glad you are experiencing better work conditions now. Did you got to Atlas? Curious about how they treat their employees.

Anonymous

Yep, at Atlas now. The company treats it’s people well. I was also at Omni for a while and felt that they too treated us with respect. Although the pay was a little on the low side all of the flights operations management (chief pilot, vp of ops, fleet manager) are all great people and really seem to care about their pilots. I hope Omni pulls through. I made quite a few friends at NAA and have nothing against the pilots and flight attendants. Great group of people. The company just left a bad taste in my mouth.

Damian K. Jackson

Don’t get your hopes up. I was briefly part of Atlas after they combined with Polar-Air Cargo and sent us into bankruptcy. ACMI flying is not the same pre-2006/7/8. Hence, doing PAX charter for more revenue. Curious to know the outcome of whistle-blower case within Atlas. Lovely fleet but maintenance cost are catching up on all those 400-freighters. So much for the withdraw in Iraq/Afghanistan. Reap every benefit you can get.

http://pulse.yahoo.com/_34VESEIG6LCXFGG7N3MN2CDP3Y Mike Starsman

Its very unprofessional for a licensed pilot to bash their former employer at such a tragic time as this bankruptcy. When NAA was run by Dan Mckinnon, it was an airline of great pride. I was a former crew travel coordinator for NAA and at no time did my department ever encounter crews stranded without hotel rooms (left the company in 2005). I feel terrible for the eventual terminations of the ground staff at JFK who worked to make NAA a great airline. Such a shame Dan Mckinnon sold this airline to a terrible company. He must be sad to see the news.

Anonymous

Expressing my opinion for not having enjoyed my experience working for a company isn’t bashing them. It’s stating FACTS. These are things I’ve actually experienced while there. They’re not made up. We live in corporate America. The concept of “if you can’t say anything nice then don’t say anything at all” doesn’t apply today. My employer would have no problem telling me if I they had issues with my performance. It works both ways. I feel sympathy for all of those at NAA and World who will lose their employment. I hope they rebound quickly. But trust me, as a pilot who’s worked for six airlines and been furloughed twice, this is a cut throat industry. My priority as a pilot is first and foremost the safety of my passengers and crew. Next on my list is how much money I can make. The idea of having loyalty to an airline is in the past. Deregulation took our career (a career I’ve worked very hard at and spent tens of thousands of dollars building) and made it into a life long struggle for a halfway decent paycheck. You get what you pay for.

http://pulse.yahoo.com/_34VESEIG6LCXFGG7N3MN2CDP3Y Mike Starsman

Show some class, that is what I was getting at. Grow up, we all have bad experiences in life. You’ve moved on, and that’s great. No one seems to share your narrow view.

Anonymous

As a crew member off NAA i can verify long days of flying and getting to destinations with no hotel booked, no picks ups scheduled – which sometimes resulted in missed commercials and long hour sitting at airports waiting for flights. That did’nt of course contribute to financial state of the company – just verifying what was said earlier. I can say when the company was trying to “cut costs” over the past few years the only group asked to take concessions that I am aware of, were the pilots and flight attendants,

http://www.facebook.com/jtakin Jeff Takin

World was not a “terrible” company at the time they acquired NAA…it was under the boneheaded leadership put in place by corporate robbers matlin-patterson that the 2 airlines grew terrible, and eventually bankrupt, together.

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